Jeffrey LewisWMD Proliferation Financing Executive Order

Dafna Linzer reports President Bush will sign an Executive Order allowing the United States to freeze assets of persons who do business with eight entities in North Korea, Iran and Syria that the Bush Administration believes are involved in poliferation:

But the draft executive order goes far beyond previous measures by threatening the U.S. assets of individuals or companies, including foreign banks, that do business with those on the list.

“If there is a bank in some European capital that is participating in working with one of the entities and that bank has some assets in the U.S., it is conceivable that some action could be taken to the bank’s assets here,” said one senior official with knowledge of the order’s details.

[snip]

A presidential commission that reviewed the failings of the prewar intelligence on Iraq made recommendations to improve intelligence-gathering and halt trafficking in weapons of mass destruction. Officials said their new effort would address a key recommendation by the commission but could not identify which one.

There were some classified recommendations, but this is my guess:

15. The President should expand the scope of Executive Order 13224 beyond terrorism to enable the Department of the Treasury to block the assets of persons and entities who provide financial support to proliferation.

A full copy of Executive Order 13224 is available from the Treasury Department.

One might usefully ask whether such measures go far enough. Geoffrey Forden did. Writing in Arms Control Today, Forden proposed a dedicated international auditing authority that would track down and investigate financial transactions that might be related to WMD trade:

An international auditing authority, however, could use access to bills of lading, letters of credit, customs reports, and other international trading documentation to unearth the correlation of shipments among purchasers, manufacturers, and trading companies and reconstruct a complete picture of proliferation deals. Private banks wanting to do business with major industrialized countries could be required to grant auditing privileges to the international authority and to do business only with participating banks. Suspicious trade activity could be tagged and examined in detail, including underlying contracts, yielding further insight into suspicious shipments.

[snip]

If international investigators had these tools years ago, they might have fleshed out Khan’s activities far before his public confession in February 2004 or the October 2003 intercept of a cargo ship carrying centrifuge components to Libya for use in enriching uranium.

Late Update: The Executive Order is now available.

Comments

  1. J (History)

    Is there a Bolton link?

    Recall that the NSA intercepts at the heart of the Bolton nomination controversy referenced not only U.S. citizens, but also U.S. companies, as possible “entities of interest”. In other words, perhaps one reason the Administration is taking a hard line on no release of these intercepts is that some prominent U.S. companies (or financial backers of the GOP) may be complicit in dirty proliferation dealings.

    Furthermore, wouldn’t it be especially embarassing for the Administration for this news to come out at the same time it is hawking a new Executive Order to crack down on precisely those kinds of companies?

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